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Bm - Daniel Todaro - 22th diciembre 2021

With a market of over £200 billion globally, the luxury fashion brand sector is significant; you only have to look at conglomerates like Richemont, LVMH Group and Kerring which boast Alexander McQueen, Balenciaga, Chloe, Cartier, Dior, Fendi, Gucci, Saint Laurent and Stella McCartney within their stables to name a few.


While in China, the market share will increase by 14% by 2025, it will contract by 8% in Europe and the United States. However, the global trend of luxury consumerism appears to be on the rise, at 43%. Generations Y and Z are projected to account for roughly 55% of the luxury fashion market over the next decade versus 32%, offsetting the decline in sales among older generations. But can perceived "luxury" brands be so sure that their mass appeal can extend beyond the surface?


Is fashion, in general, no longer tribal? The vast majority of Generations Y, Z, and Alpha, the less "affluent" generations, seem to take a more fluid approach to fashion, as they can take to gender, sexuality, technology, socializing, etc. That sees an anything-in-fashion approach, focused less on branding and more on individualism.


Long ago the need to conform to a stereotype or compete with others. The fashion I see is an eclectic mix of secondhand clothing, let's avoid the pretense that it's "vintage" and let's be real, combined with fast fashion that is naturally sourced and ethical to create a look. A look that is unique to one person and one voice, occasionally sprinkled with luxury brand items to complete the look.


So, will this approach to high-end fashion make the luxury sector grow, particularly for the brands that "get it" or contract with maybe some brands that become obsolete for generations X, Y and what is more important, Alpha? After all, this generation that may be on a budget won't necessarily be a decade from now and if they don't aspire to own luxury brand items, they may choose to share the budget more sparingly with brands that speak to them, investing into brands that resonate with spirit, not tradition, and demonstrate a social conscience in manufacturing, the environment,


Some high-end brands are already evolving to appeal to the next generation, Supreme and Balenciaga have adapted to meet the needs of their new consumers. From their “peer-worthy” Instagram collectibles to gender-fluid online stores, brands are listening closely to their audience and adjusting accordingly, watching them become more popular than stuck traditional luxury brands.


With "luxury" and "fast fashion" known to be a sizeable contributor to global greenhouse gases, water and air pollution, combined with poor working conditions, we are seeing a conscious effort by many people to change your fashion habits. These changes include a "less is more" strategy, buying second-hand, opting for natural fibers, and investigating branding practices, often cajoling them into sharing the manufacturing process and provenance.


According to Oxfam, more than eleven million items of clothing end up in landfill. The charity has launched its second-hand campaign in September, with artists who performed at Glastonbury 2019 donating stage outfits to auction or win. Its purpose is to change habits and encourage people not to buy new clothes for a month and then wear clothes more often and not throw away unwanted clothes.


In contrast, the recent "will-spinning" that was ego-inflating philanthropy towards the campaign to rebuild Notre Dame topped $700 million with the billionaires behind these luxury giants pledging $339 million. Surely this landmark is culturally worthy and needs to be rebuilt, however some may argue that these donations serve to demonstrate that the priorities of luxury brand owners may not be in sync with the market they will design and market to in less than a decade and beyond. With the Energy Agency estimating that by 2030 the planet will need 50% more water and 50% more energy, the scarcity of natural resources will be a known factor that will force all brands to change. Nobody is immune.


At the opposite end of the spectrum, fashion retailer H&M has reported an 11% rise in net sales to SEK 57.4bn (£4.8bn) in its second quarter results (July 2019), on compared to the 2% sales increase seen during the same period last year. It's the fifth consecutive quarter of steady sales growth for the company, but despite the increase, shares of the retailer fell 1.8% in early trading in July, with H&M saying, "there's still a lot of hard work to be done and a lot of challenges to come".


Evolution in the luxury sector is slow compared to "fast fashion" and with revenue and profitability declining year over year, there are not only economic factors at play, but also how the Generation Alpha consumer will be more selective and conscious. As of 2025, Generation Alpha is estimated to have over 2 billion people and is expected to start spending their own cash. Therefore, the change in the narrative and approach of the "brands" chosen to market to a growing generation, must start now.


Like those brands that were deemed too big to fail, is the end in sight for many luxury brands that continue to focus their attention on a dying generation?


Image cober: John Cameron